I was reading up on this the other day and wanted to post a fast overview.

What it does is for each item in a failed combine it does a flat check on the skill. Currently that includes even items that would be returned anyway like a File or hammer.

Level 1 is around 5%, level 2 is 15%, level 3 is 25% from the posts I read. So if you have level 3 and 8 items in the failed combine, on average 2 would be returned due to 8 checks of 25% random each time. You can get more than that, theoretically you could luck out and get all 8 back, but that's extremely unlikely.

There is a bug that's being fixed in the next patch or two that has to do with containers built into a zone like a brewing barrel. Each time Salvage works there the game and you go out of sync because the server and client thinks the Salvaged item is in different spots. Therefore they think your out of synch/LD and eventually log you off. The way to work around till fixed is immediately close the container and reopen to get your item.